How to Start a corporation in Massachusetts

The first step will be to decide on a name for your business. Choose a name that is memorable and unique, easy to understand and pronounce, and accurately represents your business. When picking out a name, remember to conduct a name search to find out whether it is available. Jot down one or two alternatives, in case the name you settle on is not available for registration in Massachusetts.

There are a few rules that Massachusetts Corporations must follow in order to register a name.

1. The name you choose must be unique and not "confusingly similar" to the name of any other Massachusetts business. This is to prevent fraud or misrepresentation and is a common rule in all 50 states.

   You can find out whether a name is available in Massachusetts by searching the Secretary of the Commonwealth of Massachusetts' subject search database. Search for reserved business names by business entity name or requestor name. Be sure to check variations or alternate spellings as well, otherwise your filing may be rejected.

   You can also use our business name search service, and we will do a more thorough search on your behalf and report back our findings. MyCorporation also include a business search for free when we complete your LLC filings for you.

2. Your business name must include the words "Limited Liability Company," or its abbreviations "L.L.C." or "LLC."

Most states require that you designate a registered agent for your business, and Massachusetts is no exception. A registered agent (often abbreviated as RA) acts as the state's means to communicate with a business. An RA is responsible for receiving legal and official documents related to the business. This may be an individual or third party service that agrees to accept legal papers on the corporation's behalf. A corporation may not act as its own registered agent for service of process.

In the state of Massachusetts, it is required that all business entities filed in the state maintain a registered agent. This registered agent may be an individual or entity that receives official and legal documents on behalf of the business. They must be an Massachusetts resident, have an Massachusetts street address, and be available at the given address during normal business hours to accept service of process. A P.O. Box is not accepted as a registered agent address. A member of the LLC can act as the registered agent if desired, or you may also use a third-party registered agent service like MyCorporation.

Registered agent information is publicly available. This may cause privacy concerns for business owners who do not wish to list their personal contact information for everyone to see. It is also common for the registered agent to become a target of spam or robocalls since this private information is relatively easy to obtain.

Another issue that may arise is that in the case of a lawsuit, these documents would be hand delivered directly to the registered agent. In the case that you used your business location for this purpose, this could occur in front of your customers. This is why many business owners opt for a third-party registered agent service such as MyCorporation to act as a registered agent on behalf of their business.

The state of Massachusetts requires you to file Articles of Incorporation in order to legally create a Corporation. The Articles of Incorporation is a simple one page form that contains all of the basic information required to register your business. This document includes basic information about the Alabama corporation such as:

• Name of the corporation
• Purpose of engaging in business
• Total number of shares and par value
• Preferences, limitations, and relative rights of each class or series
• Restrictions, if any, imposed on the articles of organization upon the transfer of shares of any class or series of stock
• Other lawful provisions
• Effective date of organization of the corporation
• Name and street address of the initial registered office
• Name and street address of President, Treasurer, Secretary, and Director(s)
• Fiscal year end of the corporation
• Brief description of the type of business in which the corporation intends to engage
• Street address of the principal office of the corporation
• Street address where the records of the corporation required to be kept in the commonwealth are located
• Signature(s), name(s), address, and date

The filing fee is $275 for up to 275,000 shares. For each additional 100,000 shares, you must pay $100. Make all checks payable to the Commonwealth of Massachusetts.

Corporate bylaws are a detailed set of rules agreed upon and adopted by the board of directors after a corporation is formed, that specify the internal management structure of the corporation. They are typically drafted by the corporation's founder or directors. Corporate bylaws are not submitted to the state.

The state of Massachusetts does not require a corporation to create bylaws upon approval of the Certificate of Incorporation, but it is strongly recommended. Bylaws allow a business to maintain consistency in the way it operates and communicate organizational rules to help avoid conflicts and disputes. They cover how directors are elected, meetings are organized, and officer roster and summary of duties. In addition to management, bylaws specify details about ownership rights, annual meetings, and the addition or removal of officers and directors.

If you are not sure how to create corporate bylaws, you can purchase MyCorporation's customized Minutes and Bylaws Package. This kit provides you with the internal documents required to fulfill your corporate formalities and properly operate your business after incorporating.

The board of directors of a corporation are normally elected by the shareholders. However, for a new business, the incorporator (the person who signed the Certificate of incorporation) will often designate the initial directors if there are no initial directors named in the certificate of incorporation. This is done by creating the "Statement of Incorporator" which will list the names and addresses of the initial directors of the business.

The statement of incorporator is then signed by all of the incorporators, which passes all elements of control over to the initial directors. This is filed not with the state, but in a corporate minute book of the incorporation. It is kept as part of the corporate record.

The first meeting of the board of directors is an important time in the life cycle of a corporation. During this meeting, the initial directors of the business will adopt the corporate bylaws, set the fiscal year, and appoint corporate officers. It is also common to authorize the issuance of shares of stock to the founders of your company, usually in exchange for assets.

This meeting, and all future meetings of the board of directors, must be recorded in corporate minutes. Minutes are documents that detail what was discussed and any decisions the business makes during meetings. They are stored with the corporate records.

Corporate minutes are required for all Massachusetts corporations by law. Falling behind on keeping and maintain minutes can jeopardize the corporation's liability protection and overall tax advantages. It is important to maintain updated corporate minutes and keep copies of all the signed and approved minutes or actions by unanimous consent from any special or annual meetings of the corporation's shareholders and directors.

Stock is a representation of ownership in your corporation. When your shareholders purchase stock, they are buying a small piece of your business. Although it's not legally required, it is common that most corporations will issue paper stock certificates to their shareholders.

In a private company (not publicly traded on the stock market), you can set the value to each stock however you see fit in your corporate bylaws. For example, one share could be worth $10 or $10,000, either would be completely acceptable. If you have additional questions, you may contact the Massachusetts Department of Business Oversight to learn more.

Many businesses need licenses or permits to operate in Massachusetts. It is also important to obtain a license to practice certain professions in Massachusetts as well. Find out more about licensing requirements necessary for your startup by visiting the business licenses and permits portal at Mass.gov.

In the event that you need a bit of help, you may also turn to MyCorporation's business license compliance package. Our skilled professionals will do the work for you. We identify all of the licenses required by your business and provide you with the information you need in order to file.

An EIN (also referred to as a Federal Tax ID) is a nine-digit number that is issued by the IRS and used to uniquely identify your business for tax purposes. Think of it as a Social Security Number (SSN) for your business, except an EIN is less sensitive. It is important to wait until the LLC has been approved by the state before applying for an EIN. For that reason, filing for an EIN is one of the last things to do when you are setting up a business.

• Open business checking, savings, or investment accounts
• File taxes for the business
• Complete payroll for employees if applicable
• Obtain lines of credit and credit cards, as well as "build credit" for your business
• Apply for applicable business licenses when required.

You will only need a few pieces of information to file including your mailing address and legal business name. You can apply online Opens in a new window with the IRS by downloading IRS Form SS-4 (PDF)(116 KB), or work alongside a third party organization like MyCorporation to complete an EIN application.

If a Massachusetts corporation pays more than $100 in wages to employees each calendar quarter, you'll need to obtain a State Employer Identification Number, or SEIN. You'll need to register with the Massachusetts Employment Development Department Opens in a new window (EDD).